Document of The World Bank FOR OFFICIAL USE ONLY Report No: PAD2239 INTERNATIONAL DEVELOPMENT ASSOCIATION PROJECT APPRAISAL DOCUMENT ON A PROPOSED CREDIT IN THE AMOUNT OF SDR 109.4 MILLION (US$150 MILLION EQUIVALENT) TO THE SOCIALIST REPUBLIC OF VIETNAM FOR A CENTRAL HIGHLANDS CONNECTIVITY IMPROVEMENT PROJECT June 1, 2017 Transport & ICT Global Practice East Asia And Pacific Region This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS (Exchange Rate Effective April 30, 2017) Currency Unit = Vietnam Dong (VND) US$1 = 22,743 VND SDR1 = US$1.37102 Fiscal Year January 1 – December 31 ABBREVIATIONS AND ACRONYMS ACG Anti-Corruption Guidelines ASEAN Association of Southeast Asian Nations BCR Benefit Cost Ratio BOT Build Operate Transfer CFMB Central Fund Management Board CPS Country Partnership Strategy DC Direct Contracting DLI Disbursement-linked Indicator DOF Department of Finance DOT Department of Transport DPC District People’s Committee DPI Department of Planning and Investment DRVN Directorate for Roads of Vietnam DST Department of Science and Technology ECOP Environmental Code of Practice EHS Environmental Health and Safety EIRR Economic Internal Rate of Return EM Ethnic Minority EMDP Ethnic Minority Development Plan ESIA Environment and Social Impact Assessment ESMP Environmental and Social Management Plan EPC Environmental Protection Commitment EPP Environmental Protection Plan FMM Financial Management Manual GDP Gross Domestic Product GFDRR Global Facility for Disaster Reduction and Recovery GIS Geographical Information System GNI Gross National Income GoV Government of Vietnam GRM Grievance Redress Mechanism GRS Grievance Redress Service GSO General Statistics Office IA Internal Audit IDA International Development Association INDC Intended Nationally Determined Contribution IPF Investment Project Financing IPSAS International Public Sector Accounting Standards IRAP International Road Assessment Programme IT Information Technology M&E Monitoring and Evaluation MoF Ministry of Finance MoT Ministry of Transport MPI Ministry of Planning and Investment MTEP Medium Term Expenditure Plans NPF New Procurement Framework NTSC National Traffic Safety Committee O&M Operation and Maintenance ODA Official Development Assistance PAP Program Action Plan PAT Performance Assessment Tool PC People’s Committee PDO Project Development Objective PMU Project Management Unit POM Project Operations Manual PP Procurement Plan PPC Provincial People’s Committee PPSD Project Procurement Strategy Document PRMF Provincial Road Maintenance Fund PRVR Program Results Verification Report PTSC Provincial Traffic Safety Committee RAP Resettlement Action Plan RF Results Framework RVR Results Verification Report SAV State Audit of Vietnam SBV State Bank of Vietnam SCD Systematic Country Diagnostic SEDP Socio-Economic Development Plan SMART Specific, Measurable, Assignable, Realistic, Time-related SOE State-Owned Enterprise SSS Single Source Selection ST State Treasury STEP Systematic Tracking of Exchanges in Procurement TA Technical Assistance TCQM Technical Control for Quality Management Department VHLSS Vietnam Household Living Standards Survey VND Vietnamese Dong VRAMP Vietnam Road Asset Management Project VWU Vietnam Women’s Union WTO World Trade Organization Regional Vice President:Victoria Kwakwa Country Director:Ousmane Dione Jose Luis Irigoyen Senior Global Practice Director: Practice Manager: Almud Weitz Mitsuyoshi Asada, Phuong Thi Minh Tran, Van Task Team Leader(s): Anh Thi Tran The World Bank Central Highlands Connectivity Improvement Project (P159238) BASIC INFORMATION Is this a regionally tagged project? Country(ies) Financing Instrument No Investment Project Financing [ ] Situations of Urgent Need of Assistance or Capacity Constraints [ ] Financial Intermediaries [ ] Series of Projects Approval Date Closing Date Environmental Assessment Category 22-Jun-2017 30-Jun-2023 B - Partial Assessment Bank/IFC Collaboration No Proposed Development Objective(s) To improve the connectivity, safety and climate-resilience of the National Highway 19. Components Component Name Cost (US$, millions) Road Improvements 145.00 Implementation Support 8.70 Organizations Borrower : Socialist Republic of Vietnam Implementing Agency : Projects Management Unit No. 2 PROJECT FINANCING DATA (US$, Millions) Page 1 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) [✔] [ ] IBRD [ ✔ ] IDA Credit [ ] IDA Grant [ ] Trust [ ] Counterpart Funds Parallel Funding [ ] Crisis Response [ ] Crisis Response Financing Window Window [ ] Regional Projects [ ] Regional Projects Window Window FIN COST OLD Total Project Cost: Total Financing: Financing Gap: 153.70 153.70 0.00 Of Which Bank Financing (IBRD/IDA): 150.00 Financing (in US$, millions) FIN_SUMM_OLD Financing Source Amount Borrower 3.70 International Development Association (IDA) 150.00 Total 153.70 Expected Disbursements (in US$, millions) Fiscal Year 2017 2018 2019 2020 2021 2022 2023 Annual 0.00 6.04 28.55 43.18 35.26 26.55 10.42 Cumulative 0.00 6.04 34.59 77.77 113.03 139.58 150.00 INSTITUTIONAL DATA Practice Area (Lead) Transport & ICT Page 2 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) Contributing Practice Areas Climate Change and Disaster Screening This operation has been screened for short and long-term climate change and disaster risks Gender Tag Does the project plan to undertake any of the following? a. Analysis to identify Project-relevant gaps between males and females, especially in light of country gaps identified through SCD and CPF Yes b. Specific action(s) to address the gender gaps identified in (a) and/or to improve women or men's empowerment Yes c. Include Indicators in results framework to monitor outcomes from actions identified in (b) Yes SYSTEMATIC OPERATIONS RISK-RATING TOOL (SORT) Risk Category Rating 1. Political and Governance  Low 2. Macroeconomic  Low 3. Sector Strategies and Policies  Moderate 4. Technical Design of Project or Program  Moderate 5. Institutional Capacity for Implementation and Sustainability  Moderate 6. Fiduciary  Substantial 7. Environment and Social  Moderate 8. Stakeholders  Moderate 9. Other  Low 10. Overall  Moderate Page 3 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) COMPLIANCE Policy Does the project depart from the CPF in content or in other significant respects? [ ] Yes [✔] No Does the project require any waivers of Bank policies? [ ] Yes [✔] No Safeguard Policies Triggered by the Project Yes No Environmental Assessment OP/BP 4.01 ✔ Natural Habitats OP/BP 4.04 ✔ Forests OP/BP 4.36 ✔ Pest Management OP 4.09 ✔ Physical Cultural Resources OP/BP 4.11 ✔ Indigenous Peoples OP/BP 4.10 ✔ Involuntary Resettlement OP/BP 4.12 ✔ Safety of Dams OP/BP 4.37 ✔ Projects on International Waterways OP/BP 7.50 ✔ Projects in Disputed Areas OP/BP 7.60 ✔ Legal Covenants Sections and Description Institutional Arrangements Financing Agreement: Schedule 2, Section I.A.1 Recurrent, Continuous Obligation of the Recipient, through MOT, to maintain the PMU2 with composition, powers, functions, staffing, facilities and other resources satisfactory to the Association. Sections and Description Annual Work Plans Financing Agreement: Schedule 2, Section I.B.1 Annual, Continuous Obligation of the Recipient, through MOT, to prepare and furnish to the Association not later than July 15 in each Page 4 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) year, beginning in 2017, a draft annual work plan; and finalize and furnish to the Association not later than December 31 in each year, beginning in 2017, a final annual work plan; and thereafter ensure the implementation of the Project during the following calendar year in accordance with the annual work plan agreed with the Association. Sections and Description Project Operations Manual Financing Agreement: Schedule 2, Section I.B.2 Recurrent, Continuous Obligation of the Recipient, through MOT, to carry out the Project in accordance with the Project Operation Manual; and not amend, waive or abrogate any provisions of the manual unless the Association agrees otherwise in writing. Sections and Description Safeguards Financing Agreement: Schedule 2, Section I.D Recurrent, Continuous Obligation of the Recipient to ensure that the Project is carried out in accordance with the safeguards instruments (as defined in the Financing Agreement); and not amend, abrogate, or waive any of the safeguard instruments unless the Association agrees otherwise, and report on their status of implementation as part of the semiannual progress reports. Sections and Description Mid-Term Review Financing Agreement: Schedule 2, Section II.A.2 Due Date: 30 months after the Effective Date Obligation of the Recipient, through MOT, to carry out jointly with the Association a midterm review to assess the status of Project implementation, as measures against the performance indicators set forth in the Project Operations Manual. Conditions Type Description Effectiveness Financing Agreement: Article IV, Section 4.01 The Project Operations Manual has been duly adopted by MOT. Page 5 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) PROJECT TEAM Bank Staff Name Role Specialization Unit Team Leader(ADM Mitsuyoshi Asada GTI02 Responsible) Phuong Thi Minh Tran Team Leader GTI02 Van Anh Thi Tran Team Leader GTI02 Procurement Specialist(ADM Hoai Van Nguyen Procurement GGO08 Responsible) Financial Management Cung Van Pham Financial Management GGO20 Specialist Abigail C. Baca Team Member DRM GSU08 Aristeidis I. Panou Team Member Legal LEGES Chi Kien Nguyen Team Member Transport GTI02 Dzung Huy Nguyen Team Member DRM GSU08 Hien Thi Thu Vu Team Member Coordination EACVF Hong Chen Team Member Operations GTI10 Parthapriya Ghosh Safeguards Specialist Social GSU06 Romain Pison Team Member Transport GTI02 Tara Shirvani Team Member Climate Change GTI08 Thao Phuong Tuong Team Member Coordination EACVF Thu Ha Le Team Member Legal LEGES Thu Thi Le Nguyen Environmental Specialist Environment GEN2B Extended Team Name Title Organization Location J. R. Cook Civil Engineer Hanoi, Ly Thi Dieu Vu Consultant Vietnam Safeguards and Social Tam Giang Nguyen World Bank Office in Hanoi Hanoi,Vietnam Development Consultant Page 6 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) VIETNAM CENTRAL HIGHLANDS CONNECTIVITY IMPROVEMENT PROJECT TABLE OF CONTENTS I. STRATEGIC CONTEXT ............................................................................................................... 8 A. Sectoral and Institutional Context ...................................................................................... 8 B. Higher Level Objectives to which the Project Contributes ............................................... 10 II. PROJECT DEVELOPMENT OBJECTIVES ................................................................................... 11 A. PDO.................................................................................................................................... 11 B. Project Beneficiaries.......................................................................................................... 11 III. PROJECT DESCRIPTION .......................................................................................................... 11 A. Project Components.......................................................................................................... 11 B. Project Cost and Financing ................................................................................................ 13 C. Lessons Learned and Reflected in the Project Design ...................................................... 13 IV. IMPLEMENTATION ................................................................................................................. 14 A. Institutional and Implementation Arrangements ............................................................. 14 B. Results Monitoring and Evaluation ................................................................................... 15 V. KEY RISKS ............................................................................................................................... 15 A. Overall Risk Rating and Explanation of Key Risks.............................................................. 15 VI. APPRAISAL SUMMARY ........................................................................................................... 16 A. Economic Analysis ............................................................................................................. 16 B. Technical............................................................................................................................ 19 C. Financial Management ...................................................................................................... 20 D. Procurement ..................................................................................................................... 21 E. Social (including Safeguards) ............................................................................................. 23 F. Environment (including Safeguards) ............................................................................... 244 H. World Bank Grievance Redress....................................................................................... 255 VII. RESULTS FRAMEWORK AND MONITORING............................................................................ 27 ANNEX 1: PROJECT MAP .............................................................................................................. 37 Page 7 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) I. STRATEGIC CONTEXT A. Sectoral and Institutional Context 1. Over the past decade, Vietnam has taken advantage of its rapid economic development to develop both its transport infrastructure and services, but road investment in the Central Highlands region is still low. The Government has continued to increase public spending on transport, from about US$1 billion in 2002 to more than US$5 billion in 2012, and has introduced a number of measures to improve the competitiveness of road transport. The road network has been significantly transformed over the past 10 years from 2005 to 2014, with a total percentage of paved network that increased from 19 to 50 percent, and a total length that increased by 30 percent. While Vietnam has a complete road network with a relatively high road density of about 0.87km of road per sq.km, the full potential of such a network is indeed hindered by its poor condition due to low levels of maintenance and maintenance financing, as well as the lack of a sufficient core network of main roads. Currently the extent of expressways is at 740km, or 2.2km per 1000 km2, a significantly lower density than most neighboring countries. About 96 percent of national roads are paved, but only about 43 percent are in good condition; 37 percent are in average condition; and 20 percent are in poor to very poor condition. Provincial and local roads are in worse condition than national and urban roads. The overall network is only about 30% paved due to the significant share of district and commune roads that remain unpaved. When paved, the road pavements are often of poor quality. The average spending on road maintenance in the Central Highlands region is one of the lowest in the country in absolute value, with about VND 270 billion spent in 2011 at the Provincial level, far behind the VND 2,800 billion spent in the Red River Delta (MoT/DRVN data). Such a level of spending cannot stem further deterioration of the road asset and hinders the life-cycle performance of the roads. Road investment spending in the Central Highlands region is also one of the lowest on average in the period 2011- 2015, with about VND 6,055 billion spent in 2011, to be compared with the VND 12,552 billion spent in the Red River Delta in the same year (MoT/DRVN data). 2. Recent figures from the General Statistics Office of Vietnam report an exponential increase in trade after 2007, with trade between Vietnam and Cambodia reaching US$2.3 billion in 2010 and US$3.03 billion in 2015. Border gate trade between Vietnam, China, Laos and Cambodia is estimated to have reached US$30 billion in 2016. Trade between Cambodia and Vietnam is supported by the Regional corridor R9 from the Association of Southeast Asian Nations (ASEAN) Highway Network, which includes the National Highway No. 19 (NH19) on the Vietnamese side. This project will not only improve the connectivity of the coastal regions to the poorer central highlands regions, but also help the Cambodian economy by linking it to the thriving economy of Vietnam. The increase of regional trade and cross-border trade is hindered by the quality of the road, low density of the core road network, and high cost of road transport. Average road transport costs, represented by trip time, are the highest in the region after Indonesia, and are indeed holding back Vietnam’s competitiveness and trade efficiency. Meanwhile, there is a serious backlog of unmet demand, as inter-city two-lane roads such as NH19 are insufficient in meeting the growing demand for regional and inter-city mobility. The core national road network, representing the main corridors of the country, is not sufficient to support growth and trade development, and needs further investment. This shows that investment needs in the road sub-sector are still substantial and would benefit from continued financing, especially for inter-modal road links between major transport hubs, such as the proposed project. Page 8 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) 3. Road fatalities account for about 96 percent of transport fatalities in Vietnam, and while death rates have been reduced by more than 30 percent between 2004 and 2012, road safety remains a challenge. According to the Asia Development Bank’s estimates, the economic loss and damage caused by annual road accidents in Vietnam is about US$880 million, making up 2.45 percent of GDP (in 2003), which is higher than the average level of ASEAN countries (2.1 percent of GDP). According to the Master Plan on road traffic safety in Vietnam, the loss and damage caused by traffic accidents on roads in 2007 was estimated to be 2.89 percent of GDP, equivalent to VND 32,600 billion and keeps increasing. An increase in motorcycle use has substantial consequences in terms of the increase in accidents; additional vehicles within the same area, increased capacity of vehicles to accelerate, as well as the limited protection offered to users, are all elements that make this transport mode more dangerous than others. In 2004, Vietnam had a death rate from road accidents of 16 per 100,000 inhabitants, but reduced this to 10.2 in 2012 (MoT/DRVN data), an encouraging reduction (World Bank data). Motorization rates increased by 320 percent from 2002 to 2013 (compound annual growth rate (CAGR) of 11 percent), while road length network increased by 30 percent over the same period (CAGR of 4 percent). This motorization rate, coupled with weak regulations and capacity to tackle the challenge of road safety, is leading to further levels of congestion, faster degradation of assets, as well as lower levels of safety for road users. 4. The traffic characteristics on NH19 are quite mixed, with large numbers of heavy trucks and high speed vehicles, plus significant numbers of motorcycles, non-motorized traffic and local pedestrians. The lack of road capacity and safe conditions not only constrains NH19’s connectivity role but also exposes vehicles using the road to a high risk of traffic accidents. During the implementation of the Vietnam Road Safety Project (VRSP), financed by IDA and completed in 2012, the International Road Assessment Programme (iRAP) consultant assessed most of NH19 as Star 1 and 2 ratings, which revealed that NH19 was one of the critically dangerous roads, and strongly suggested NH19 be a next priority road safety project. NH19 is on the priority list of the National Traffic Safety Strategy up to 2020 with vision to 2030. 5. The current climatic environment, with its variability and extreme weather events, makes Vietnam infrastructure highly susceptible to climate impacts, which are likely to increase over time. The interaction of infrastructure assets with terrain and climate results in a range of potential vulnerabilities depending on the nature of both the infrastructure assets and the climate threat. The NH19 corridor comprises a range of geomorphological and climatic zones; from near coastal through mountainous to central plateau, and the principal concerns as to its climate resilience are likely to be centred around: (i) Erosion and instability of earthworks in steep terrain, (ii) Flooding of sections of the highway where the vertical alignment is low, and (iii) Erosion to bridge abutments and piers. The combination of this with significant changes in land-use, the variable geotechnical environment and the impact of climate have made these mountainous provinces areas of significant landslide activity. According to statistics published by the Vietnam Institute of Geosciences and Mineral Resources (under the Ministry of Natural Resources and Environment), there are over 10,250 points of landslide risk in the 10 Northern Mountain Provinces, of which about 2,100 have been classified as large to very large. Every year during the rainy season significant soil or rock failures affect these highways, sometimes with a soil- rock mass up to thousands of cubic meters. Such landslide risks and other climate and disaster risks, including flooding, do not uniquely apply to roads, but all modes of transport. 6. The proposed project aligns with the Government of Vietnam’s objectives, policies and strategies, as confirmed by the Prime Minister Decision No. 07/2011 / QD-TTg approving the plan of transport development in the key economic zone of the Central Vietnam to 2020 and orientations to 2030 for national highways, as well as the Minister of Transportation Decision No. 3936 / QD-BGTVT on December 3rd, 2014 approving orientations and Page 9 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) transport infrastructure development in the Central Highlands in 2015, and to 2020. The proposed project also aligns in vision and timing with the one stop one window approach for the Le Thanh/Ou Yadav border gate at the Vietnam-Cambodia border, inaugurated in December 2015 as a way to reinforce trade and cooperation between the two countries, and to create favorable conditions in the transport links between Vietnam, Cambodia and other member states of ASEAN. B. Higher Level Objectives to which the Project Contributes 7. The proposed project is closely aligned with the World Bank Group’s twin goals of ending extreme poverty and boosting shared prosperity, as well as the overarching theme of sustainability, given the evidence of the strong negative relationship between extreme poverty and accessibility/mobility as an auxiliary support to trade and competitiveness. Research carried out in Vietnam and neighboring countries since 2000 has shown that investments in roads has had significant impacts on poverty alleviation, social participation, and health services (Van de Walle & Cratty 2002, Banwatt 2014). It has been estimated that an investment of 1% of GDP per year in transport benefitting the rural and lagging areas has helped reduce the poverty rate by 1.5% per year, on average. As such, the proposed project will further leverage benefits from the current Government-financed program to rehabilitate in parallel the feeder roads that link the agricultural zones to the main NH19 corridor, therefore reducing further transport costs along the corridor. 8. This operation is also consistent with the World Bank Group’s Vietnam Country Partnership Framework (CPF) FY18-22 (Report 111771-VN). In particular, in its recommendations and focus areas to: (a) enable inclusive growth, and in particular its sub-focus area on “[…] trade competitiveness, multi-modal transport connectivity, and logistics services”, and (b) enable environmental sustainability and resilience, and in particular its sub-focus areas on “[…] climate resilience, strengthen natural resource management and improve water security”, and “[…] strengthen disaster risk management and preparedness”. The principal rationale for Bank assistance is that the proposed project directly contributes to the poverty reduction and economic growth objectives set out in the Vietnam Systematic Country Diagnostic (SCD) and is fully aligned with the Government’s development strategies, notably the SEDS and the 2016-2020 SEDP. The project is also aligned with Vietnam 2035, in particular in its focus areas: (a) Chart an environmentally sustainable development path and enhance climate resilience, and (b) Promote equality and inclusion of marginalized groups, to develop a harmonious middle-class society. 9. The proposed project supports the Intended Nationally Determined Contribution (INDC) plan of Vietnam to the UNFCCC. In particular the project directly responds to the INDC’s climate change adaptation priority actions outlined for 2021-2030, which include among others to: 1) implement disaster prevention plans and measures, protect peoples’ lives, and ensure national defense and security, 2) Consolidate and develop prioritized and urgent disaster prevention projects; strengthen the capacity of search and rescue forces, 3) develop infrastructure and make plans for residential areas; relocate and resettle households and communities from areas affected frequently by storm surges, floods, riverbank and shoreline erosion, or areas at risk of flash floods and landslides and 4) allocate and mobilize resources for community-based climate change adaptation and disaster management; raise awareness and build capacities for climate change adaptation and disaster risk management. Moreover, the project addresses the government’s commitment to the “V20” or “Vulnerable 20” group of top nations globally which are most affected by the catastrophes rooted from climate change. Page 10 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) II. PROJECT DEVELOPMENT OBJECTIVES A. PDO To improve the connectivity, safety and climate-resilience of the National Highway 19 1. B. Project Beneficiaries 10. The Project’s Key Beneficiaries will be people living in the Binh Dinh and Gia Lai Provinces, both in rural areas and the periphery of the main cities that NH19 corridor is crossing, representing approximately 1.5 million people, and 6,200 light motor vehicles per day. These will include farmers, livestock producers, small business owners, freight and passenger transport companies. Road users benefitting from the improved road corridor will be both from a local traffic dimension and a transit traffic dimension, including cross-border traffic with Cambodia. Road user benefits will accrue thanks to increased access to social services and markets, as well as the decongestion in roads that provide improved access to the city of Pleiku and around, as well as the Anh Khe Pass which would consequently reduce travel costs and times, together with the accompanying road safety outcomes. 11. Additional beneficiaries include the commuters residing outside of the Central Highlands and shippers of freight, representing approximately 1,400 trucks per day. Commuters who use daily several sections of the NH19 corridor to access jobs and services will benefit from the economic agglomeration opportunities generated by the project through the reduced congestion and consequent reduced travel/commuting times. Moreover, important benefits will be generated for freight movement at the national level contributing towards reduction of transport and logistics costs through travel time and vehicle operating costs reductions, and ultimately enhancing the agricultural export potential, as well as imports from Cambodia. III. PROJECT DESCRIPTION A. Project Components 12. The proposed Project will be financed by an IDA credit of US$150 million 2 and counterparts’ funds of US$3.7 million to finance the following components, and will build on the lessons and results from previous World Bank- financed transport projects while expanding into new areas of engagement to address road safety and climate change. The Project will finance the following components: 13. Component 1 – Road Improvements (estimated cost of US$145m including contingencies) • This component will support the physical improvement of three sections of NH19 including pavement rehabilitation, widening of the road with paved shoulders, widening of lanes and features for the safe sharing of the road by users, including through the addition of dedicated motorcycle 1 National Highway 19 is from Quy Nhon Port to the Le Tanh border gate, which is located at the border with Cambodia. 2 Including US$9.5 million on IDA blend terms and US$140.5 million on IDA hard terms. Page 11 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) lanes, and reinforcement of slopes, to improve road connectivity, safety and to ensure sustainability of road assets. • The project will also finance the acquisition of land as necessary along the right of way and for the bypasses and compensation related to land and asset loss and involuntary resettlement, for a total estimated amount of US$17 million. • The total length of these 3 sections is 153km (out of a total length of 247km of NH19), composed on 127km of inter-urban roads and 26km of urban roads (bypasses), to complement the two Build- Operate-Transfer (BOT) sections of 75km implemented by the Government. The MoT and the two Provinces of Binh Dinh and Gia Lai are joining efforts in addressing connectivity and road safety issues on NH19 by promoting two BOT improvement projects in parallel with NH19 during the past few years. The two BOT sections are now in service and collecting tolls. These BOT sections have also established a reasonable precedence for cross-section designs to accommodate the separation of fast and slow speed vehicles and motorcycles in urban, semi-urban and rural areas. By the time of the completion of the proposed NH19 sections, all the other sections totaling 247km of roads will be completed, enabling better connectivity along the entire corridor. • The proposed component will help improve the remaining sections by completing the establishment of NH19 as a Road Safety Corridor that meets international connectivity requirements with traffic safety standards including the Vietnam’s Traffic Safety Strategy requirements of a minimum of iRAP 3 3-star standard, through road infrastructure safety features. • As the proposed 153km section for financing contains sections that are highly prone to landslides and potential natural disasters, a targeted intervention on these sections will contribute to the overall connectivity, resilience and safety along the entire corridor. 14. Component 2 – Implementation Support (estimated cost of US$8.7m including contingencies) through the following interventions: • The provision of technical support for Project implementation, including overall detailed engineering design, construction supervision, financial audits, environmental and social management, and monitoring and evaluation. 15. During implementation, the Bank will provide enhanced implementation support and technical assistance to both components of the project through Bank-executed activities funded from the Global Facility for Disaster Reduction and Recovery, and the Global Road Safety Program, as described below: a) Bank- executed activities related to road safety supported from the Global Road Safety Program (GRSF): (i) Conduct a Road Safety Audit (RSA) on NH19 in order to inform MOT’s proactive management of safety improvements of NH19 by identifying risks associated with road safety deficiencies, (ii) Assess impacts of 3 iRAP is the International Road Assessment Programme and provides a simple and objective measure of the level of safety provided by a road’s design through star rating. Star ratings involve an inspection of road infrastructure elements that are known to have an impact on the likelihood of a crash and its severity. Between 1 and 5-stars are awarded depending on the level of safety which is ‘built-in’ to the road, 5 stars being the safest. Page 12 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) motorcycle lanes in Vietnam to inform the update of the draft manual for motorcycle lane design and specifications with incorporation of international best practices, and (iii) Strengthen the institutional capacity of MOT and the Project Management Unit No. 2 (PMU2) for managing road safety and physical works to improve road safety measures of the road network (estimated cost 0.15 million). b) Bank-executed activities related to climate resilient activities with support from the Global Facility for Disaster Reduction and Recovery (GDFRR): (i) Support a landslide risk assessment of the project area that could be used by MOT to inform the identification of suitable climate resilience measures and design options to reduce the impact of landslides on NH19, and (ii) Provide cross-over recommendations on the limits and the strengths of the current technical standards, as well as on possible improvements to incorporate climate change adaptation and disaster risk management considerations in the design of road infrastructure (estimated cost 0.15 million). B. Project Cost and Financing Counterpart Project cost IDA Financing Project Components Funding (US$) (US$) (US$) Component 1: 145.00 141.30 3.70 Component 2: 8.70 8.70 Total Costs 153.70 150.00 3.70 Front End Fees Total Financing Required 153.70 150 C. Lessons Learned and Reflected in the Project Design 16. One of the key lessons from the World Bank Group knowledge in transport is that improvement of road safety can only be achieved with strong targeted intervention. While road improvements will bring a reduction in vehicle operating costs and smooth and organized traffic flows, these do not result in road safety improvement by themselves, as improved road conditions very often induce increases in speed that lead to an actual increase in traffic accidents on the improved road. To achieve road safety improvements, i.e. reduction of traffic accidents, projects should include strong interventions, enforcement, and high standards of signage, with evidenced empirical safety measures on the road. The separation of motorcycle traffic in countries with high volumes of motorcycle traffic has a proven record of effectively reducing motorcycle-related accidents in many countries such as China and Pakistan, and is expected to lead to road safety improvement in Vietnam. 17. Road investment and maintenance, especially in areas prone to landslide and climate change related disasters, require adequate identification, planning, and costing procedures in order to obtain the highest value for money over road life cycles. Lessons from all previous road transport projects in Vietnam and China show that sound analysis and feasibility studies at appraisal are required to put in place adequate procedures Page 13 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) for: a) the planning of the investments and subsequent maintenance activities, and b) the paving and engineering choices adapted to the local economics of the investment and the level of engineering necessary for sustained operations of the infrastructure. In Vietnam, the choice of construction design and paving technique based on resilience and local climatic conditions may need to be fine-tuned locally with regards to transport economics and detailed spatial development considerations so that the value for money is maximized. A detailed road costing exercise that takes into account, among other factors, population density, localization of economic and social centers, locations of hazard areas, as well as construction material cost and availability, may help optimize the road design choices over the road life cycles. 18. Analysis of past projects in Vietnam implemented by the World Bank also shows that successful implementation of projects is the outcome of strong institutional capacity particularly in infrastructure projects. There is a strong correlation between the success of a project and the capacity of the implementing agency, and enhanced capacity of the implementing agency is a perquisite for a successful project. Therefore the eventual evidence of institutional enhancement should be measured by the successful implementation of the project. IV. IMPLEMENTATION A. Institutional and Implementation Arrangements 19. The Ministry of Transport (MOT) is the owner of the project and will have the overall responsibility of overseeing the implementation of the project. MoT will report to the GOV, coordinate the activities of central and provincial government agencies and fulfill IDA requirements. MOT will also approve the overall feasibility/construction investment report and the overall procurement plan; provide policy/strategic guidance and instruction to the Project Management Unit No. 2 (PMU2). The PMU2 is MoT’s authorized executing agency, and will have the overall responsibility for approving survey methodologies and plans, detailed engineering designs and cost estimates, bidding documents and requests for proposals, bid and proposal evaluation reports, bidding results and signing contracts in accordance with procurement requirements, as well as monitoring the quality of works and reviewing periodic reports such as the audits. 20. MoT has assigned PMU2 to be responsible for the project implementation at the national level. PMU2 will act as the fiduciary agent on behalf of MoT in procurement and financial management (FM) for these components. PMU2 will be in charge of the procurement of goods, works and services related to all project components and supervision including contracting and payments. PMU2 will also be responsible for coordination, quality assurance, training, monitoring and evaluation, day-to-day supervision of project activities. PMU2 is also responsible for implementation of the traffic safety activities in close collaboration with National Traffic Safety Committee (NTSC) and Provincial Traffic Safety Committees (PTSCs) of Binh Dinh and Gia Lai Provinces. PMU2 is familiar with the Bank’s fiduciary and safeguard requirements as it has successfully completed the Bank-financed Vietnam Traffic Safety Project (VRSP) in 2012. In addition, it also has rich experiences in managing various projects financed by GoV’s budget and ODA donors. 21. At the Provincial level, Provincial People’s Committees (PPCs) of Binh Dinh and Gia Lai Provinces will be responsible for overall implementation of the resettlement and compensation of their related project road sections within their administrative jurisdiction. Page 14 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) B. Results Monitoring and Evaluation 22. The Monitoring and Evaluation (M&E) system, including a Results Framework (RF), is designed to assess whether the project is being implemented in line with the proposed objectives and its achievement of expected results. Measurement of the project’s progress in the carrying out of the activities within the identified components that feed the M&E system will be documented in project Progress Reports. 23. The responsibility for the preparation of these reports falls under the PMU2. In order to collect all relevant information, and data, this unit will coordinate with departments within MoT. The reports will be prepared on a semi-annual basis and submitted to IDA for review. In addition to reporting on the project results indicators and intermediate outcome indicators, the reports will include information on disbursements, compliances with financial management, procurement, social and environmental policies and guidelines, and an updated annual plan of works and activities. V. KEY RISKS A. Overall Risk Rating and Explanation of Key Risks 24. The overall risk to the Project is rated Moderate. The key risks are mainly imposed by fiduciary prospects, technical, environmental and social, and institutional risks, as detailed hereafter. 25. The Fiduciary Risk is rated Substantial due to the risks related to the financing of land acquisition and compensation for resettlements and loss of assets, including risks that (i) the payments are not made not in accordance with the approved RAPs, (ii) cash will be misappropriated during the payments, (iii) counterpart budgets are not allocated sufficiently for project implementation; the procurement risks identified in section D of the Appraisal Summary, including the Borrower’s unfamiliarity to the Bank’s New Procurement Framework (NPF), (iv) inconsistencies between local legislation and the Regulations particularly in relation to the Construction Law, (v) delays due to factors beyond the control of procurement such as resettlement, and unclear decisions within the government on on-grant/on-lending arrangements between Ministry of Finance and the project executing Ministry (MoT). There are three main mitigation actions identified: (i) the update of the Financial Management Manual (FMM) to reflect recent developments in the ODA project management regulations and the updated Bank guidance, and train the project staff on the updated version of the FMM and the designed procedures and controls relating to the payment of compensation for resettlement, (ii) the allocation of sufficient annual budget for project implementation; (iii) an independent thematic audit on compensation will be conducted to ensure the compliance of the compensation activities, and (iv) the support of the World Bank towards the use of the NPF, as well as procurement specific recommendations detailed under section D of the Appraisal Summary. The first was completed by Negotiations and the second and third actions will be carried out during the project life. 26. The Technical Design risk is Moderate as it relates to the complexity of the implementation of road safety and climate resilient infrastructure features in a context that mixes inter-urban roads and urban roads with a broad range of road users. The likelihood of this risk to achieving result is moderate, and will be managed by sound feasibility studies, which will assess the best technical features for each segment of the NH19. Segregated motorcycles lanes, for instance, may not be appropriate on all segments of the corridors; additional lanes/ramps Page 15 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) for trucks may be only necessary in certain zones. The detailed review of such studies will help to limit the technical risk and ensure value-for-money of the road investment. In addition, technical audits will be conducted during the program implementation period in coordination with the Client so that it will ensure technical compliance. 27. The Environmental and Social Risk is Moderate as the project is expected to bring about significant positive socio-environmental impacts during operation phase and adequate mitigation measures and environmental monitoring programs have been developed and are presented in the Environment and Social Management Plan (ESMP). Vietnam is however one of the world’s most disaster prone countries and specific activities related to landslide and climate resilience will be conducted. Every year extreme weather and climate change impacts in the form of floods and droughts lead to serious damages to the infrastructure, including roads, and impose high economic costs on Vietnam. The World Bank is working closely with the Government to help reduce the high levels of vulnerability, promote mainstreaming of disaster risk reduction in relevant sectors and to improve local capacity for disaster risk reduction and management. At the Project level, this will be mitigated through careful understanding of potential climate and disaster impacts on the Project road sections, incorporation of climate resilient designs, and strengthening institutional capacity of the transport sector to address climate adaptation in the road sector. This will partially be informed by the climate scenarios and landslide study for the road network previously conducted by MoT with support from JICA. The social risks are limited as the two bypasses avoid urban populated areas, and an EMDP and two RAPs have been prepared accordingly. The project does not carry any risk of significant degradation of critical natural habitat, forests or physical cultural resources in any tangible and/or irreversible ways. Measures to mitigate these potentials are specified in the project’s ESIA and ESMP. Land acquisition is limited to 191.7 ha of private agriculture land and 5.6 ha of residential land for both (i) widening of existing alignment and (ii) two proposed bypasses. 28. The Institutional Capacity risk is Moderate as it consists in the capacity of the implementing agencies to design, implement and monitor the project in a satisfactory manner, given the road design and use. The likelihood of this risk to achieving result is moderate, and will be managed by a close and reinforced implementation support from the Bank, including through the use of a Performance Assessment Tool (PAT) to assess and visualize the progress of the works on each section of the road. VI. APPRAISAL SUMMARY A. Economic Analysis 29. An economic evaluation following conventional economic appraisal methodology for road improvement has been conducted for three technical options for bypasses. The analysis gives an Economic Internal Rate of Return (EIRR) of 15 percent for the best option (option 2 as detailed here below) and the sensitivity analysis confirms the robustness of the project’s return, with a worst case of an 11 percent EIRR if the costs increase by 20 percent and the benefits decrease by 20 percent. Three technical options have been analysis as follows: Option 1 OPTION 2 Option 3 Base Case NPV (10%) US$ $55,045,296 $64,773,916 $30,767,279 IRR % 14.50% 15.72% 13.67% Worst Case (cost to increase by 20% AND benefit decrease by 20%) Page 16 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) NPV (10%) US$ $150,669 $11,463,357 ($7,843,690) IRR % 10.01% 10.97% 9.09% 30. The three options that have been analyzed are as follows: (i) Option 1: Construction of 13.7km section to bypass An Khe Town and 21km section to bypass Pleiku City and Dak Doa Town, (ii) Option 2: Construction of 13.7km section to bypass An Khe Town and 13km section to bypass Pleiku, and (ii) Option 3: No bypass. The five measure points for the traffic counts are defined vis a vis chainage of NH19 as follows: (1) average of counts at km20 and km 49+550, (2) average of counts at km76 and km90+900, (3) counts at km124+720, (4) average counts at km142+040, km135, and km157, and (5) average counts at km180 and km197+300. The analysis quantifies five typical benefits of a road improvement scheme as follows: (i) Vehicle operating cost savings as result of better road or/and shorter road, (ii) Value of time savings both passengers and freight as result of better road or/and shorter road, (iii) Accident savings as result of safer road, (iv) GHG savings as result of better road or/and shorter road, (v) Emergency repair savings as result of better and more resilient road. Benefits are quantified basing on available data using combined standard transport modelling and a separate traffic assignment model. Traffic, as well as the three main contributions to benefits are detailed hereafter: Traffic (Vehicles per Day, 2016) Road sections Motorcycle Car Van/Bus Truck PCU Measure Point 1 8,777 912 719 1,987 6,852 Measure Point 2 6,841 696 659 1,239 4,779 Measure Point 3 2,458 722 606 1,259 4,835 Measure Point 4 9,256 1,231 579 1,441 5,504 Measure Point 5 2,969 582 273 776 2,851 VOC Savings Million US$ Option 2022 2025 2030 2035 2040 2042 Option 1 13.4 15.5 19.7 24.1 29.1 31.4 Option 2 13.3 15.4 19.7 24.1 28.9 31.2 Option 3 6.9 8.0 10.1 12.4 14.9 16.1 VOT Savings Million US$ Option 2022 2025 2030 2035 2040 2042 Option 1 1.15 1.33 1.70 2.09 2.51 2.71 Option 2 1.15 1.34 1.70 2.09 2.50 2.70 Option 3 0.83 0.96 1.23 1.51 1.81 1.95 Accident Savings Million US$ Option 2022 2025 2030 2035 2040 2042 Option 1 4.4 5.8 9.4 14.6 22.7 27.1 Option 2 4.4 5.8 9.4 14.6 22.7 27.1 Page 17 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) Option 3 4.4 5.8 9.4 14.6 22.7 27.1 31. The analysis compares annual discounted costs and benefits of the project to society as a whole over the project life-time in “with” and “without” cases using the Net Present Value (NPV) and the Internal Rate of Return (IRR) indicators to justify the economic viability. The project will generate economic benefits by reducing vehicle operating costs by US$13.3 million by 2022, and US$31.2 million by 2042. Annual project costs and benefits are evaluated for a 25 year period, allowing for a 5 year construction period starting in 2018, followed by a benefit period of about 20 years. A discount rate of 10 percent is employed to convert annual cost/benefit streams into present value in the year 2017 according to the most recent Guidelines of the World Bank in 2016. Movement along the Southern Central corridor from Quy Nhon to the Border gate of Cambodia will be improved by upgrading the existing National Highway 19 (NH19) and constructing new road sections to bypass cities the corridor passes through. While there is a single engineering design proposed for the upgrade of the existing NH19, there were 3 options studied for bypasses, which resulted in differences not only in resettlement, civil work costs but also traffic reassignment on influenced road network. The 3 options have been compared and the most economically sound one selected (with an EIRR of 15 percent as indicated above), with the construction of 13.7km section to bypass An Khe Town and 13km section to bypass Pleiku. 32. Given the public and the private natures of the interlinked investments that consist in the proposed project and the existing BOT sections, the economic analysis for the proposed project analyzed the mutual economic impacts between the project and the BOT sections. Those impacts include: (1) the estimated additional toll revenues to the BOT operators due to the “induced” traffic increase attributed to the proposed project, and (2) the influence of the existing BOT to the proposed project. 33. The analysis clarified that the proposed project will not bring substantial additional induced benefits to the BOT sections. This result is due mostly to the fact that there is no network effect on the traffic, with no competing primary road segments along NH19, as it constitutes the only key corridor in the area running West to East through the BOT sections. Given the traffic forecast, it is estimated that the revenues of the two BOT sections will increase at most by 7.5 percent in the first year (year 2022) and will then slowly decrease down to 2.3 percent (year 2040), in with project case compare to without project case. 34. The influence from the BOT sections to the traffic volume on the proposed project is solely attributed to the “toll impedance” to the traffic on the proposed project section of NH19. Tolls of any kind increase the costs of using the travel route. The local traffic might favor non-tolled local road options around the BOT sections, and may therefore potentially divert from the continued sections of the proposed project. However, the behavior of long-distance journeys, which are the majority users, is quite different and it is unlikely that these journeys are diverted from the BOT sections by sacrificing the significant time saving benefit, and therefore, it is unlikely that they are diverted from the proposed project sections. 35. The GHG evaluation concludes that without the project 4.936 million tons of CO2 emissions are expected over the evaluation period, while with the project the CO2 emissions increase marginally to 4.954 million tons (increase of 0.018 million tons of CO2 or 0.35 percent). The analysis was done with the estimation over the evaluation period the total CO2 emissions with and without the project on the project road that are a function of vehicle speeds and vehicle utilization. Without the project 4.936 million tons of CO2 emissions are expected over the evaluation period, while with the project the CO2 emissions increase marginally to 4.954 million tons (increase of 0.018 million tons of CO2 or 0.35 percent). The increase is marginal because the vehicle utilization over the evaluation period with the project remains about the same as without the project because the added Page 18 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) generated and induced traffic with the project is compensated by the reduction in the length of the project road. The marginal increase in CO2 emissions with the project has negligible impact on the economic justification of the project. B. Technical 36. Based on experience in the execution of past road projects in Vietnam, the technical aspects have been solidified with a mix of good design, best practice, and adaptation of solutions to the country context. The main technical choices consist in: (i) the choice of Category III with 11m-wide paved surface for most of the sections with the highest level of traffic, (ii) the improvement of the remaining Category IV sections of the road and designated bridges to meet upgraded standards, (iii) the full rehabilitation of bridges when considered not meeting the width and load capacity necessary to accommodate the current and future traffic, (iv) the adaptation with the incorporation of differentiated design approaches to include more hazard resilient measures in more climate vulnerable roads; and (vi) the integration of road safety measures in the design, with special attention to motorbikes. 37. The proposed upgrade will include widening of the road to provide dedicated motorcycle lanes, pavement rehabilitation, improvement of intersections, and the furnishing of road safety facilities. Designated existing bridges along the road will also be widened and strengthened under the proposed Project. As NH19 is impacted by a range of climatic zones, from near coastal through mountainous to a possible rain shadow at the Vietnam/Cambodia border area, the upgrade will also improve the road’s resilience to climate threats and impacts by investing in prioritized resilience works along the road. Summaries of the proposed upgrade for the road sections follow: a) From Km 50 to Km 90, the existing road will be widened to provide 11m wide carriageway consisting of one motor lane and one dedicated motorcycle lane at each side except for section Km 59 – Km 67 on An Khe Pass where the carriageway will be minimum 8m wide, and sections in residential areas where the carriageway will be 13m wide. This section includes the An Khe Bypass where a new 13.7km-long road section with the carriageway of 11m will be constructed. b) From Km 131 to Km 180, the width of the existing carriageway will be increased from 7 to 11m in non- residential areas and to 13m in residential areas with an exception of sections Km 131+300 – Km135+00 and Km 155 – Km160, where 14m and 16m wide carriageway will be provided respectively. This section will consist of a new road section of 13km length (from around Km 157 to Km177 of the existing road) to bypass the Pleiku City. No work will be carried out for the section Km 160 – Km 180 where the existing road has met the required standards. c) From Km 180 to Km 243, carriageways of 11m and 13m widths will be provided in non-residential and residential sections, respectively, as a result of the road widening of the proposed Project. At the end of the road, section Km 241 – Km 243 has been invested to meet urban road standards, and thus will not be financed under the proposed Project. 38. The project includes existing bridges to be improved through widening and strengthening in order to meet the required standards. Studies of application of various alternatives of I-shape, T-shape and Super T pre- stressed concrete girder for superstructure have been conducted and selected for each of the proposed bridges. In addition, new bridges will be constructed along the two proposed bypasses. Page 19 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) 39. There are cost implications with respect to the climate strengthening measures to counter potential climate change related impacts over and above standard Vietnam design practice for national highways. Experience clearly indicates that the proactive climate strengthening of vulnerable highway sections results in significant savings in whole-life repair and maintenance costs as well as reducing risks to access and to life. The sections of the proposed NH19 project most likely to require these additional works are: (i) An Khe Pass section from km 59 to km 67 and particularly an approximately 6.5km length where several areas of current instability indicate a significantly vulnerable area, (ii) Rolling terrain between Pleiku and the Vietnam Border where the several short sections of the current alignment are low and vulnerable to flooding, and (ii) key bridges. 40. The An Khe Pass as well as short lengths of alignment beyond Pleiku requires specific in relation to slope protection, bridge protection and drainage. A 6.5km section of the An Khe Pass alignment runs through steep terrain mainly on sidelong ground that is currently showing signs of instability and is consequently assessed as being vulnerable to climate impact. In addition to requiring standard geotechnical measures to stabilize existing failures there needs to additional measures in terms of drainage, and slope protection to pro-actively counter the consequence of climate threats. These measures should be focused on identified key spots such as, for example, areas of cut-to-fill and lengths of horizontal realignment requiring significant fresh cuts. The alignment in the rolling terrain beyond Pleiku currently contains short lengths of low lying carriageway in between higher ground that could be susceptible to flood. Raising the alignment 0.6m above normal flood is an option to consider as a resilience option in these cases. C. Financial Management 41. The assessment has concluded that the project meets the minimum Bank financial management requirements, as stipulated in OP/BP 10.00. 42. The Project Financial Statements will be audited by independent auditors acceptable to the Bank in accordance with TORs acceptable to the Bank. The cost of the audit will be funded by the Project. The Audited Financial Statement will be sent to the Bank within six months after the year end. In addition, the semi-annual Interim Financial Reports (IFRs) will be prepared by the PMU2 and sent to the Bank within 45 days after the end of reporting period. 43. Internal Audit (IA) will be carried out by the respective IA functions of the MOT. The specific roles and responsibilities of the IA will be described in the Project FMM. . 44. Two Segregated Designated Accounts (DA) at a commercial bank acceptable to the World Bank will be maintained by the PMU2. The first DA will be used solely for payments for compensation of resettlement and the second DA will be used for all other eligible expenditure. The DAs will be denominated in United States Dollars (USD). The ceiling of DAs will be variable, based on a forecast of one quarter’s expenditures to be financed out of the DA funds. Supporting documentation required for documenting eligible expenditures paid from the DA will be the Statement of Expenditure and supplemental statements as described in the disbursement letter. The frequency for documenting expenditures paid from the DA will be quarterly or more frequent if required. The Minimum Application Size for Reimbursements, Special Commitments and Direct Payments will be US$100,000 equivalent. Counterpart funds of US$3.7 million will be used to finance expenditures such as salaries of civil Page 20 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) servants seconded to work on this project, training activities, operating costs for managing the projects and monitoring/evaluating project activities. 45. The Project will have a Disbursement Deadline Date 4 four months after the Closing Date. This "Grace Period" is granted in order to permit the orderly project completion and closure of the Credit account via the submission of applications and supporting documentation for expenditures incurred on or before the Closing Date. Expenditures incurred between the Closing Date and the Disbursement Deadline Date are not eligible for disbursement. Eligible expenditure for IDA financing means the reasonable cost of goods, works, non-consulting services, consulting services and resettlement compensation to be financed by IDA at 100 percent, inclusive of taxes. Percentage of Amount of the Credit Allocated (US$) Expenditures to be Category IDA Blend IDA Hard Financed Total Terms Terms (inclusive of Taxes) (1) Goods, works, non-consulting services, and consulting services 9,500,000 123,500,000 133,000,000 100% under the Project (2) Resettlement Compensation 0 17,000,000 17,000,000 100% TOTAL AMOUNT 9,500,000 140,500,000 150,000,000 - D. Procurement 46. Applicable Procurement Procedures. For contracts financed in whole or in part by the IDA Credit, procurement would be carried out in accordance with the World Bank’s “Procurement Regulations for IPF Borrowers: Procurement in Investment Project Financing” (hereinafter referred to as “Procurement Regulations”) dated July 1, 2016; and the provisions stipulated in the Financing Agreement. Under the proposed project World Bank planning and tracking system, Systematic Tracking of Exchanges in Procurement (STEP), will be used to prepare, clear and update Procurement Plans and conduct all procurement transactions for the Project. Accordingly, all the procurement activities under the proposed project will be entered into, tracked and monitored online through the system. 47. Procurement Capacity and Risk Assessment. Procurement Capacity and Risk Assessment (PCRA) for PMU2 was conducted during various project preparation missions. It found that PMU2 has certain experience in conducting procurement in accordance with the Vietnam public procurement law and regulations and in implementing a number of ODA funded projects including projects financed by the World Bank, and JICA. PMU2 has well established organizational structure and relatively adequate number of staff to implement the project. However, it also revealed a number of risks that could adversely influence the project implementation if not mitigated, including following key risks: (i) despite having some experience with Bank projects, there are still some gaps concerning knowledge and experience of carrying out procurement activities in accordance with the Bank’s Procurement Regulations, rules and procedures particularly with respect to the new possibilities afforded by the Procurement Framework; (ii) Lack of practical guidance on the steps of procurement process, in particular, 4 Final date on which World Bank will accept applications for withdrawal from the Recipient or documentation on the use of Credit proceeds already advanced by the World Bank. Page 21 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) the PMU2 has not had a manual to guide its staff carrying out the Bank procurement procedures step by step; (iii) Potential preference to use national procurement rules and procedures when there is difference with the Bank’s Procurement Regulations; (iv) Potential fraud/corruption and collusive practices; and (v) Inadequate contract management capacity causing implementation delays and/or leading to contractual disputes. In order to mitigate the above identified risks and strengthen the procurement capacity of PMU2, the following measures have been established and agreed with PMU2 to be implemented during project implementation: (i) Providing procurement training for PMU2’s staff, including initial training during project preparation and in-depth procurement trainings during project implementation; (ii) Preparing and adopting a project operation manual (POM), including a detailed chapter on procurement; (iii) Assigning qualified staff to ensure the procurement plans that have been developed are implemented, monitored and updated in a proper and timely manner; (iv) Signing and executing a Transparency and Ethics Statement by all members of bid/proposal evaluation committee when carrying out their duties; (v) Providing appropriate training on contract management and hands-on support to PMU2 staff during contract execution; and (vi) Carrying out regular implementation support missions and conduct annual procurement post review. 48. Procurement Strategy. Based on the project requirements, operational context, economic aspects, technical solutions and market analysis, a Project Procurement Strategy Document (PPSD) has been developed for the project by the PMU2 with the support from the Bank team. The PPSD identifies the following types of activities (a) Works contracts for the construction of road and bridges, road maintenance, and traffic safety system etc. (approx. US$100 million), and (b) consultancy services for detailed design of works and preparation of bidding documents, construction supervision, environmental impacts monitoring, auditing, etc. (approx. US$15 million). For the procurement of civil works, the estimated cost per package is ranges from US$14 million to US$23 million. The PPSD showed that there are a lot of potential contractors in the country for this type of works (nature and size) and international firms have shown very limited interest in contracts estimated to cost less than US$20 million, an open competition approaching the national market was found to be the most suitable choice. Nevertheless, foreign contractors are still allowed to participate if they wish to do so. For contracts with an estimated cost above US$20 million, there would be open competition which approaches the international market. For the consulting services including civil works design, construction supervision, auditing and etc. the estimated cost per package is ranges from US$0.3 to US$5 million with major assignments being the detailed design and construction supervision (estimated US$1.5 million and US$5 million, respectively). 49. Although the market research demonstrates that there are a significant number of potential consultants in the country for this type of services given the nature of the civil works that needs to take into account the factors of safety and climate resilience, the participation of reputable and qualified international consultants will be beneficial to the project implementation therefore the project will be approaching the international market. For civil works contracts which approach the national market, the harmonized model bidding documents agreed with the Bank will be used. For all other procurements the Bank’s Standard Procurement Documents shall be used. The PPSD also indicates a number of potential risks that may affect the success of the procurement process including (i) frequent changes and overlap in the policy regime of Vietnam; (ii) inflation leading to increase of the investment cost; (iii) high rate of PMU2’s procurement staff turnover; (iv) weak financial capacity of many bidders; and (v) desire of the bidders to win the contract at any cost that may negatively affect the quality of works and implementation progress. A number of risk mitigation measures as well as allocation of risks to the party that is in best position to take the risks are also proposed in the PPSD. 50. Procurement Plan. Based on the PPSD, the initial procurement plan for the project was prepared by the Page 22 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) PMU2 and agreed by the Bank at negotiation. For the civil works contracts, Request for Bids (RFB) is the method to be used. Regarding goods procurement, there are a number of small goods contracts under the project that will be procured using RFB method details of this are in the procurement plan. For efficiency, contracts with a cost estimate of less than US$200,000 and US$100,000 for works and goods respectively will be procured using RFQ. For consulting services, QCBS, QBS, FBS, LCS with the most appropriate market approach will be used. The Procurement Plan will be updated at least annually (in real time) by the PMU2 to (a) reflect project implementation; (b) accommodate changes that should be made; and (c) add new packages as needed for the project. All procurement plans, their updates or modifications shall be subject to Bank’s prior review and no- objection. Details for the procurement arrangements are provided in the Project Operations Manual. The project Procurement Plan identifies the risk for each activity and prior review of these activities is set based on the performance and risk rating. Contracts not subject to prior review will be subject to post review. The Bank will carry out procurement post reviews on an annual basis with an initial sampling rate of 20 percent, which will be adjusted periodically during project implementation based on the performance of the project. E. Social (including Safeguards) 51. Operational Policy 4.12 on involuntary resettlement has been triggered as project will acquire about 200 ha of land for both (i) widening of existing alignment and (ii) two proposed bypasses leading to loss of livelihood / sources of livelihood and will also displace households. The two bypasses are expected to be newly constructed to avoid urban populated areas. These bypasses run through agricultural fields, plantation forest and residential areas. The land acquisition will impact over 1,000 households (about 5,000 project affected persons) of which 91 households will be relocated. Project will also impact 290 business establishments, and about 20 graves of Bahnar people. Out of the over 1,000 project affected households, 60 belongs to ethnic minority. Project will also temporarily impact around 9,800 m2 of agricultural land and 3,800 m2 of public land. 52. In order to mitigate adverse social impacts, the project has prepared Resettlement Action Plans based on results of social impact assessment of the entire project corridor. The RAP includes key information on project impacts, the mitigation and compensation measures to be applied to redress the unavoidable adverse effects of project activities on local people; entitlement matrix for affected people; livelihood restoration measure for severely affected households; arrangement of RAP implementation; mechanism for information disclosure, consultation and participation; grievance redress mechanism; monitoring mechanism; and cost estimate for RAP implementation. 53. The impact of labor influx during construction has been analyzed in consultations with local communities and PMU2. Based on information available during project preparation, the labor related risks are moderate as labor camps are deemed to be isolated from cities, the construction camp sites will not limited size given the volume of works to be performed, and the labor may be primarily of local nature. Mitigation measures include detailed social related requirements in safeguard documentation to ensure that worker health plans are in place and implemented, as well as a detailed procedure for grievance and complaints. 54. An Ethnic Minority Development Plan (EMDP) has been prepared for the Gia Lai Province, where Ethnic Minority people are affected. EMDP for Gia Lai was prepared in line with World Bank Operational Policy 4.10 on Indigenous Peoples. The EMDP has been prepared based on based on the results of the social assessment (SA) carried out in the project areas as well as free, prior and informed consultations with the EM groups. The EMDP ensures that: (a) ethnic minority receives culturally appropriate social and economic benefits; (b) potential Page 23 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) adverse and positive impact on EMs are identified, adverse impacts are avoided, minimized, mitigated, and compensated; and c) the development process fosters full respect for the dignity, human rights and cultural uniqueness of EMs in the project’s affected areas, and takes into account their development needs and aspirations. Affected EM peoples have indicated their broad support for project implementation given the potential benefits the project brings to them. 55. As for citizen engagement, series of consultations were carried out in August, November, December 2016 and January 2017. Apart from community consultations, meetings were held with the Provincial Departments, the District People’s Committees, Leaders and members of affected commune officials, district compensation and Boards of Compensation and Land Acquisition, key district Departments of Environmental and Natural Resources, Agriculture and Rural Development, Industry and Commerce, and Department of Labor, Invalids and Social affairs, etc. The Results Framework captures, details and monitors the share of citizens from the impacted communes who participated in consultations, with a breakdown for women. 56. A three tier grievance mechanism has been proposed in the project. In the first tier of GRM, aggrieved PAP may submit their complaint – either in written or verbal, to the office of the Ward/Commune People’s Committee (W/C PC). W/C PC will receive the complaints and will notify the W/C PC leaders of the complaint. The Chairman of the W/C PC will meet the complainant in person and will solve it within 15 days following the receipt of the complaint. After 15 days since the submission of the complaints, if the aggrieved person does not have any response from the W/C PC, or if the aggrieved person is not satisfied with the decision taken on his/her complaint, the PAP may take the case, either in written or verbal, to the Reception Unit of City/District People’s Committee. The City/District People’s Committee will have 30 days since the date of receipt of the complaint to resolve the case. The City/District People’s Committee will register all the complaints submitted and will inform the District Board for Compensation and Land Acquisition of the City/District PC’s resolution/assessment results. 57. As part of social assessment, the project also carried out gender analysis. As part of RAP and EMDP implementation, the gender actions include (i) participation of women throughout project cycle; (ii) information dissemination specifically for women; (iii) reducing intra-household gender disparity through livelihood options; (iv) women safety and empowerment, and (v) participation of women in extension/vocational trainings. During monitoring of RAP and EMDP implementation, the key indicators of gender actions will be monitored and reflected in internal and external monitoring reports. 58. Social due diligence was carried out for the two BOT sections completed prior to the Project and NH1-North of Quy Nhon City Bypass under construction, both of which were not financed by the Bank. The two BOT sections (75 km in total) had been completed prior to the identification of the Project, but there are remaining relocations to be completed. During implementation support, the Bank will monitor and ensure that displaced households will be paid assistance for the relocation. The NH1-North of Quy Nhon City Bypass is not considered as a linked project. It originates at the NH19 and NH1 junction, but serves a different purpose than the proposed project, linking the intersection to the north of Qui Nhon City, not Qui Nhon Port. The PDO can be achieved without this Bypass. F. Environment (including Safeguards) 59. The project triggers the environmental safeguard policies on Environmental Assessment (OP/BP 4.01), Natural Habitats (OP/BP4.04) and Physical Cultural Resources (OP/BP 4.11), and has been classified as Page 24 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) Environmental Category B. PMU2 has prepared an Environmental and Social Impact Assessment (ESIA) which includes an Environmental and Social Management Plan (ESMP) in accordance with Vietnam government environmental management regulations and the Bank safeguards policies. The ESIA/ESMP have been reviewed by the Bank and found to be satisfactory. 60. The ESIA concluded that the project is expected to bring about significant positive socio-environmental impacts during operation phase. These include improving traffic safety on the existing NH19, improving connectivity between the Quy Nhon Sea Port with the Provinces in the Central Highland which contributes to socio-economic development in the region, and create short-term temporary jobs and incomes for the local people. 61. Adequate mitigation measures and environmental monitoring programs have been developed and are presented in the ESMP. Some mitigation measures would be applied during the feasibility study and detailed engineering proposals, such as designing separating lanes for motorbikes and other two-wheeled vehicles, slope protection with bioengineering method, installation of traffic safety signboards and directions, provide underpass or access roads where the designed road surface level is significantly different from existing ground level etc. The Project would reserve a budget for mine clearance which would be carried out before construction commencement. The ESMP also includes Environmental Codes of Practices (ECOP) and site-specific mitigation measures, these will be incorporated into bidding and construction contract documents. 62. The ESMP has also clearly set out the environmental responsibilities of the Project’s key stakeholders. PMU2 will appoint at least one staff to be responsible for environmental and aspects of the Project. The contractors are required to implement the mitigation measures specified in construction bidding and contractual documents. In addition, the ESMP also requires the contractors to prepare site-specific Environmental and Social Management Plans and submit to PMU2/Construction Supervision Consultant (CSC) for review and approval prior to construction commencement. The construction supervisors will play key roles in environmental monitoring and supervision during construction phase while an independent monitoring consultants would also be engaged to carry out some capacity building activities and verify project’s environmental compliance. The TOR of the Construction Supervision Consultant also includes the provisions of training on HIV/Aids for project staff and workers including PMU2, CSC team and the contractors’ workers. 63. During the preparation of environmental safeguards documents, consultations with related stakeholders on the ESIA, ESMP were conducted in project communes. Relevant feedback from the consultations have been incorporated into the ESIA and ESMP. Two RAPs and an EMDP have been prepared and will be implemented in order to manage the potential impacts related to land acquisition and affected ethnic minority households. The key contents of the two RAPs and EMDPs were summarized in the ESIA. The RAP for Gia Lai, the EMDP for Gia Lai, and the ESIA have been officially disclosed on April 20, 2017. The RAP for Binh Dinh has been officially disclosed on May 19, 2017. H. World Bank Grievance Redress 64. Communities and individuals who believe that they are adversely affected by a World Bank (WB) supported project may submit complaints to existing project-level grievance redress mechanisms or the WB’s Grievance Redress Service (GRS). The GRS ensures that complaints received are promptly reviewed in order to address project-related concerns. Project affected communities and individuals may submit their complaint to the WB’s independent Inspection Panel which determines whether harm occurred, or could occur, as a result of WB non- compliance with its policies and procedures. Complaints may be submitted at any time after concerns have been Page 25 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) brought directly to the World Bank's attention, and Bank Management has been given an opportunity to respond. For information on how to submit complaints to the World Bank’s corporate Grievance Redress Service (GRS), please visit: http://www.worldbank.org/en/projects-operations/products-and-services/grievance-redress- service. For information on how to submit complaints to the World Bank Inspection Panel, please visit www.inspectionpanel.org. . Page 26 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) VII. RESULTS FRAMEWORK AND MONITORING Results Framework COUNTRY : Vietnam Central Highlands Connectivity Improvement Project Project Development Objectives To improve the connectivity, safety and climate-resilience of the National Highway 19. Project Development Objective Indicators Unit of Responsibility for Indicator Name Core Baseline End Target Frequency Data Source/Methodology Measure Data Collection Name: Annual average daily Number 4950.00 6600.00 Baseline, and then The data is collected by The traffic count traffic (AADT) annual traffic counts manual and annual traffic responsibility falls made at the 5 points of counts conducted by the under PMU2, who the road, as indicated. local authorities under the will, in partnership guidance of PMU2. The five with local sections for the traffic authorities, hire a counts are defined vis a vis consultant to chainage of NH19 as perform the annual follows: (1) average of traffic count as counts at km20 and km detailed in the 49+550, (2) average of methodology of the counts at km76 and Results Framework. km90+900, (3) counts at km124+720, (4) average counts at km142+040, km135, and km157, and (5) Page 27 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) Unit of Responsibility for Indicator Name Core Baseline End Target Frequency Data Source/Methodology Measure Data Collection average counts at km180 and km197+300. The methodology involves trained observers who gather traffic data that cannot be efficiently obtained through automated counts in Vietnam. The equipment used is tally sheet. The unit is Passenger Car Unit (PCU). The data to measure is AADT, which is the average calculated over a year of the number of vehicles passing a point in a given counting section each day (usually expressed in vehicles per day). It simply represents the vehicle flow over a road section on an average day of the year. Short term traffic counts will be performed, with a collection data period of 7 days where data are recorded in hourly intervals. Description: Annual average daily traffic as defined in the economic analysis and in the Results Framework. This includes the light vehicles, buses, trucks and motorcycles. As the road conditions will improve, the Corridor will accommodate more traffic as its volume to capacity ratio will increase. The indicator reflects the increase in traffic Page 28 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) Unit of Responsibility for Indicator Name Core Baseline End Target Frequency Data Source/Methodology Measure Data Collection and will allow to calculate the volume to capacity ratio. Name: Average travel time Hours 6.00 5.00 Baseline, annually, and The floating car technique PMU2 will be on the NH19 Corridor then at the end of the will be used as travel time responsible for the project, at the collection method and collection, in completion of the civil consists of a vehicle that is partnership with the works. specifically dispatched to local authorities as drive with the traffic stream well as the Police as for the express purpose of necessary. PMU2 data collection. Data will hire an collection personnel within adequate consultant the test vehicle control the to perform the speed of the vehicle floating car according to set driving technique test. guidelines. A passenger in the test vehicle will manually record travel times at designated checkpoints using a clipboard and stopwatch, i.e. at the measure point as described in the Results Framework: : (1)km20 and km 49+550, (2) km76 and km90+900, (3) km124+720, (4) km142+040, km135, and km157, and (5) km180 and km197+300. The test will be performed during a period of 7 days, alternating morning, evening and peak Page 29 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) Unit of Responsibility for Indicator Name Core Baseline End Target Frequency Data Source/Methodology Measure Data Collection hours. Description: This indicator consists in the average travel time on the entire extended NH19 corridor, from Quy Nhon Port to the border with Cambodia, using a light vehicle under normal speed and traffic conditions. As the road condition will improve, as well as the safety and journey conditions, the travel time will decrease. Name: Number of kilometers Kilometers 75.00 228.00 Baseline and at the The IRAP scoring needs to PMU2 will hire of International Road completion of the civil reach 3 star or more for consultants who Assessment Program (iRAP) works. both cars and motorcycles. hold iRAP 3-star rating or above for The IRAP methodology test accreditation to both cars and motorcycles on will be performed through a perform the iRAP. the NH19 Corridor drive-through inspection that involve at least two people: one driving a vehicle and a passenger recording road infrastructure elements as they travel using a RAP Inspection Device (RAPID). This type of inspection is technical and requires inspectors to hold iRAP accreditation. The inspection will involve a continuous record of road infrastructure elements, and the video-based inspection will record video images at 5-10 metre intervals. The Star Page 30 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) Unit of Responsibility for Indicator Name Core Baseline End Target Frequency Data Source/Methodology Measure Data Collection Ratings will be based on 100 metre long sections of road. At the completion of each type of inspection, the consultant will produce a detailed condition report that summarizes many roadway characteristics for the inspected network, and produce a final report that explains how many kilometers of road are 3 star or above. Description: This indicator measures the number of kilometers of the entire Nh19 from Quy Nhon Port to the border with Cambodia that is 3 star iRAP or above. The IRAP scoring needs to reach 3 star or more for both the cars and the motorcycles. The measurement requires to perform an iRAP along the Corridor to show the improvement of the safety conditions along the corridor. iRaP is the International Road Assessment Programme and provides a simple and objective measure of the level of safety provided by a road’s design through star rating. Star Ratings involve an inspection of road infrastructure elements that are known to have an impact on the likelihood of a crash and its severity. Between 1 and 5-stars are awarded depending on the level of safety which is ‘built-in’ to the road, 5 stars being the safest. Name: Kilometers of roads Number 0.00 20.00 Baseline, and at the A situational analysis PMU2 is that are upgraded in end of the civil works. exists and includes responsible for the compliance with 20 hazard areas which are listing and mapping climate/disaster resilient subject to landslides and/or of the hazard areas design standards climate change related and monitor the disasters. Some of these number hazard areas will be treated of kilometers that by the proposed project, will be improved based on availability of accordingly. Page 31 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) Unit of Responsibility for Indicator Name Core Baseline End Target Frequency Data Source/Methodology Measure Data Collection financing, estimated costs of the works, and priority of the areas. The methodology consists in counting the number of kilometers of roads, at these key locations/hazard areas, or elsewhere along the proposed project scope, which have been subject to civil works towards the improvement of the resilience of the area. Description: The indicator is the number of kilometers of roads which have been subject to civil works towards the improvement of the resilience of the area. Intermediate Results Indicators Unit of Responsibility for Indicator Name Core Baseline End Target Frequency Data Source/Methodology Measure Data Collection Name: Roads rehabilitated, Kilometers 0.00 153.00 Baseline, then 6 month The data source consists in PMU2 will be Non-rural progress report / the progress reports of the responsible for collection, then at the contractor who will be in collecting the data end of the civil works. charge of the civil works. from the contractor The contractor will monitor and monitor the number of kilometers of progress. Page 32 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) Unit of Responsibility for Indicator Name Core Baseline End Target Frequency Data Source/Methodology Measure Data Collection road rehabilitated and provide such information as works progress. 1 kilometer rehabilitated equals 1 km of road delivered and completed, and equals 1 km of road ready to be operated/opened for traffic. Description: Kilometers of all non-rural roads reopened to motorized traffic, rehabilitated, or upgraded under the project. Non-rural roads are roads functionally classified in various countries as Trunk or Primary, Secondary or Link roads, or sometimes Tertiary roads. Typically, non-rural roads connect urban centers/towns/settlements of more than 5,000 inhabitants to each other or to higher classes of road, market towns and urban centers. Urban roads are included in non- rural roads. Name: Share of citizens from Percentage 0.00 70.00 Baseline, then during The data source is the PMU2 will facilitate affected communes who Appraisal, then at the consultants who are in the consultations participated in consultations start of the civil works charge of the safeguards and be responsible (end of consultations). elements and the RAP for the provision of related consultations in the the data. affected communes. The selection of communes will be based on types and degrees of impacts. Apart from mixed groups, the consultants will hold separate consultation with (i) men and women to identify gender issues; and (ii) ethnic minority Page 33 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) Unit of Responsibility for Indicator Name Core Baseline End Target Frequency Data Source/Methodology Measure Data Collection community to identify their issues for preparation of documents. For every consultation, the consultants will prepare minutes of the meeting and will collect signature of each participant, and the number of households. The calculation for the indicator will be done by comparing the number of households who participated in consultations with the number of households from affected communes. Share of women from Percentage 0.00 20.00 Same as main Same at main indicator, but Same as main affected communes who indicator. only for women. indicator. participated in consultations Description: This indicator measures the Citizen Engagement level during the project related consultations. It measures the share of citizens living in the affected communes who participated in consultations, through the collection of the number of households who have been consulted during project preparation. Name: Manual for Yes/No N Y Baseline, and then at The data source consists in PMU2 is responsible motorcycle lane design and the end of the project. the development and for the collection of specifications availability of the report, to the final report to be produced by the road be produced by the consultants, and the Page 34 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) Unit of Responsibility for Indicator Name Core Baseline End Target Frequency Data Source/Methodology Measure Data Collection safety consultant(s). diffusion of the report to the stakeholders. Description: This indicator measures the development and availability of a manual for the design of motorcycle lanes and the related specifications, so that the approach is harmonized through Vietnam. Name: Guidelines for Yes/No N Y Baseline, and then at The data source consists in PMU2 is responsible resilient road design and the end of the project. the development, for the collection of standards availability and diffusion of the report to be the report, when produced produced by the by the consultants. consultants, and its diffusion. Description: This indicator measures the development and availability of the guidelines for the design of resilient roads and the related standard in Vietnam, with the objective to harmonize the approach through Vietnam. Page 35 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) Target Values Project Development Objective Indicators FY Indicator Name Baseline End Target Annual average daily traffic (AADT) 4950.00 6600.00 Average travel time on the NH19 Corridor 6.00 5.00 Number of kilometers of International Road Assessment Program (iRAP) 3-star rating or 75.00 228.00 above for both cars and motorcycles on the NH19 Corridor Kilometers of roads that are upgraded in compliance with climate/disaster resilient design 0.00 20.00 standards Intermediate Results Indicators FY Indicator Name Baseline End Target Roads rehabilitated, Non-rural 0.00 153.00 Share of citizens from affected communes who participated in consultations 0.00 70.00 Share of women from affected communes who participated in consultations 0.00 20.00 Manual for motorcycle lane design and specifications N Y Guidelines for resilient road design and standards N Y Page 36 of 37 The World Bank Central Highlands Connectivity Improvement Project (P159238) ANNEX 1: PROJECT MAP Page 37 of 37